At the Skift India Summit 2024, the CEOs of popular travel companies MakeMyTrip and Yatra Online discussed the diverse nature of India and how this impacts the travel industry. They emphasized the importance of understanding India’s varied travelers and destinations and tailoring approaches to cater to different customer segments. Both CEOs highlighted the significance of millennials, online penetration, sustainable business strategies, and customized marketing tactics, taking into account the expanding middle class in the country.
The CEOs acknowledged the vast potential in the domestic travel market in India but also highlighted the increasing opportunities for outbound travel for Indian tourists. They mentioned that while domestic travel experiences are abundant and appealing to many customers, a significant portion of aspirational Indians still view international travel as a major milestone. As income levels rise across different demographic groups, there is a growing market for both domestic and international travel in India.
India’s diverse landscape poses a challenge for online travel agencies (OTAs) to understand and cater to the varied customer segments in the country. The CEOs discussed the need for deeper penetration into tier-two and tier-three markets, where there is a desire for international travel experiences. They emphasized the importance of infrastructure development to support the growing travel industry in India, suggesting that improvements in in-destination infrastructure are crucial to managing the increasing tourist traffic in popular destinations like Goa.
MakeMyTrip and Yatra Online have found success by tailoring their marketing campaigns to specific destinations and regions in India. They highlighted the benefits of segmenting messaging based on the unique characteristics and activities available in different places. By understanding the nuances of each region, these companies have been able to effectively engage with their target audience and create more meaningful connections with customers. They stressed the importance of localization and region-specific marketing strategies in India’s diverse market.
The CEOs also discussed the need for increased online penetration in India’s travel industry, especially with the growing digital market in the country. They highlighted the significant gap between internet penetration and e-commerce penetration, emphasizing the potential for growth in the online travel sector. With a focus on millennials who prefer online bookings, there is a push for greater digitization and online services in the travel industry. They emphasized the importance of expanding online penetration in the hotel segment, which lags behind the flight segment in terms of online bookings.
Finally, the CEOs cautioned against jumping into customer acquisition without considering long-term sustainability. They emphasized the need for a strategic focus on customer retention and building a sustainable business model for long-term success. They highlighted the pitfalls of aggressive customer acquisition strategies that may not lead to sustainable growth in the long run. Both CEOs underscored the importance of building a loyal customer base and retaining customers through strategic planning and thoughtful customer engagement to ensure the longevity and success of their businesses in the competitive travel industry.
